Mild inflation and political............>

CHINA PRESS: Mild inflation and political uncertainty in the U.S. will continue

to pressure the dollar index but the yuan still has room for appreciation

against the U.S. unit - although not as much as in the first half, the China

Securities Journal reported Wednesday quoting analysts. Changes in the yield gap

between China and U.S. Treasury bonds, as well as the recently added

"counter-cyclical factor," were responsible for the increase in the yuan fixing

Monday by the People's Bank of China -- the strongest since Oct. 11, according

to Guotai Junan Securities futures analyst Wang Yang. Foreign-exchange traders

said the appreciation of the yuan was very likely. Although the dollar index may

rebound if the U.S. Federal Reserve announces in September a time for another

interest-rate increase and that it will shrink its balance sheet, expectations

for yuan depreciation have fallen significantly and the chances of this are most

unlikely, Wang Yan said. (China Securities Journal)